Question: The North American Free Trade Agreement provides for two way
The North American Free Trade Agreement provides for two- way, long- haul trucking across the U. S.-Mexican border. U. S. truckers have objected, arguing that the Mexican trucks don’t have to meet the same environmental and safety standards as U. S. trucks. They are concerned that the combination of these lower fixed costs and lower Mexican wages will result in Mexican drivers taking business from them. Their complaints have delayed implementation of this agreement (except for a small pilot program during the Bush administration, which was ended during the Obama administration). What would be the short- run and long- run effects of allowing entry of Mexican drivers on market price and quantity and on the number of U. S. truckers?
Relevant QuestionsIn the Managerial Solution, would it make a difference to the analysis whether the lump-sum costs such as registration fees are collected annually or only once when the firm starts operation? How would each of these ...If the inverse demand function is p = 500 – 10Q, what is the elasticity of demand and revenue at Q = 10? The inverse demand function a monopoly faces is p = 100 – Q. The firm’s cost curve is C(Q) = 10 + 5Q. What is the profit- maximizing solution? How does your answer change if C(Q) = 100 + 5Q? A monopoly has an inverse demand function given by p = 120 – Q and a constant marginal cost of 10. Calculate the deadweight loss if the monopoly charges the profit-maximizing price.A monopoly’s inverse demand function is p = 100 – Q + (5A - A2) / Q, where Q is its quantity, p is its price, and A is the level of advertising. Its marginal cost of production is constant at 10, and its cost of a unit ...
Post your question